In recent years, the humanitarian sector has seen an increase in the interest in innovative solutions. Innovasjon Norge (Innovation Norway) is an organisation that provides capital and expertise to help Norwegian businesses grow and export sustainably. Earlier this year they published a guide providing the humanitarian sector with innovation-friendly procurement tools. Providing innovation-friendly procurement can help decrease corruption, unethical trade, and negative environmental impact (Sustainability and Responsible Business Conduct). This is exactly what Solvoz is set out to do as well. This is why we would like to share the findings of the guide with you in short.
Problems Within the Humanitarian Sector
First, you have to understand the current atmosphere in the humanitarian sector. Knowledge obtained by organisations is often not shared with peers. This means that an immense amount of money and time goes into solving the same problems. Moreover, because the wheel has to get invented again and again, it would take a lot longer for a more innovative solution to arise. Next to that, there are other problems that could occur (p.3):
1. Quality
The quality of both products and services could be overestimated. It happens more than you think, that after procuring a certain product, it turns out to have a limited lifespan, a limited use, or it cannot be used at all. This is a waste of time and money. We talk more in-depth about this in our article about Núria Pagès Feliu.
2. Short-term solutions
Building on the aforementioned, it can happen that because of a lack of resources, solutions can only be used short-term before a new product/service is needed. This eventually costs more time and money than if the most suitable solution had been used from the start.
3. Transparency
There is no transparency when it comes to procuring. An actor could choose to buy products that are unethically made or are sold by a friend or someone they made a deal with regarding profits. This way, there would have been better solutions if the product/service was obtained otherwise, but there is often no way to check this. Also, the current, broken mechanisms for reporting and evaluating to donors causes room for this to continue to happen.
Innovation-friendly procurement tools for the humanitarian sector
The guide makes a clear distinction that needs to be addressed: “While procurement of innovation means developing new and innovative solutions, innovation-friendly procurement involves finding new solutions that already exist in the market.” (p. 6). Moreover, innovation-friendly procurement means finding a solution based on needs instead of specifications. With that in mind, organisations will more likely end up with a solution that fits them best long-term. Furthermore, it is easy to only focus on detailed specifications of a solution. However, the focus should lie on the function and performance of a solution. This way, you can make use of many benefits to meet your needs in more innovative ways.
The guide’s recommendations for innovation-friendly procurement, described more in detail in the document (p. 8-9).:
- Ensure buy-in from management
- Ensure sufficient time and resources
- Build competence
- Conduct a needs assessment
- Involve the market
- Don’t over-specify
- Remember – the contract is always the most important document
- Monitor and evaluate
Needs assessments
Innovation-friendly procurement is partially based on the assessment of your organisation’s needs (p. 11). This to understand the problem you want to solve more thoroughly and to plan those needs accordingly. It requires planning and a risk assessment to fully succeed. If done well, it will increase performance and perfectly align with the end user’s needs, resulting in widespread use of the solution. This can only be done if the end user is part of the assessment, since this is the person who is most qualified to sum up all current inefficiencies. However, the end user is stuck in the sense that they will have a narrow mindset when it comes to innovation. They will often base their assessments on existing solutions. Outside experts can fill that gap.
Market dialogue
When organising an innovation-friendly procurement process, a thorough knowledge of the market is very valuable (p. 19). The guide recommends open dialogue regarding this point. It will help explain all different solutions available to satisfy a certain need. Once again, the aforementioned outside experts are a huge help in this process. And then there is the law. There are specific laws that need to be followed regarding procurement. Once the process is set in motion, there is no reverting to an earlier stage. Therefore, you need to make sure that all steps are thoroughly thought out, even when the answer turns out to be “I don’t know”. Follow the dialogue and see where it takes you.
Performance-based specifications
The specifications to ensure innovation-friendly procurement can be categorised in two ways. First, there are Technical Specifications and secondly Performance-Based Specifications (PBSs) (p. 26). While the former describes the characteristics of a solution, the latter facilitates a process where all actors within the procurement process are able to utilise their own competence. This means that there will be a more thorough process, resulting in a better solution in the end. However, technical specifications are of course still necessary and both forms of specifications should be used hand in hand.
Solvoz
Solvoz is a system that facilitates innovative procurement. It enables solutions thinking in an environment that predominantly thinks in products. It connects local organisations with local and international experts and suppliers. Our platform is visualising a community that promotes transparency, creating a more efficient humanitarian environment. Solvoz provides its users with guidance regarding criteria and requirements for a specific need, through an open access catalogue. It offers responsible solution packages with Total Cost of Ownership (TCO) thinking. The catalogue includes expert knowledge from people in the industry.
The integration of Solvoz’s solution catalogue and the tender and procurement workflow provides a more user friendly environment. It translates the needs of a response scenario into technical and performance-based specifications, which are suitable for response delivery in different contexts. As soon as a solution is tendered, Solvoz invites suppliers locally, regionally and/or internationally (based on the needs of the user) to bid for a part or the entire solution package. Solvoz actively contributes to the localisation of aid, to provide fitting solutions and open up local economies for local aid provision within an international environment. Additionally, Solvoz provides a user friendly environment, for aid agencies, local responders, health clinics, suppliers, and organisations alike. This is all done in an auditable and transparent environment.
There are many advantages to innovation-friendly procurement. It has positive effects on organisations, increases collaboration with the commercial sector, provides better solutions, and gives a better market insight. Innovasion Norge’s guide describes these points more in detail (p. 7). If you have any further questions, please do not hesitate to contact Solvoz.
